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# Consider the following two mutually exclusive projects Year Cash Flow A Cash Flow B 0 \$ 417000 \$ 36000 1 48000 19600 2 58000 14100 3 75000 14600 4 532000 11400 The

Consider the following two mutually exclusive projects:

 Year Cash Flow (A) Cash Flow (B) 0 –\$ 417,000 –\$ 36,000 1 48,000 19,600 2 58,000 14,100 3 75,000 14,600 4 532,000 11,400

The required return on these investments is 13 percent.

a. What is the payback period for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

 Payback period Project A years Project B years

b. What is the NPV for each project? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)

 Net present value Project A \$ Project B \$

c. What is the IRR for each project? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

 Internal rate of return Project A \$ Project B \$

d. What is the profitability index for each project? (Do not round intermediate calculations and round your answers to 3 decimal places, e.g., 32.161.)

 Profitability index Project A Project B

Apr 11 2020 View more View Less Subscribe To Get Solution